ZUPCO introduces USD bus fares starting 1 September

Today is the last month and has become tradition in our country the prices of various items are going up. There are Liquid Home and TelOne data tariffs which are going up tomorrow as per agreement with POTRAZ, yesterday Econet announced new tariffs for voice, data and SMS. Now state operator ZUPCO has also announced that their fares will be going up tomorrow. The truth though is that was kind of expected. At around $220 ZWL their fares were simply now too low.

What is surprising are the new USD bus fares. ZUPCO being a government owned entity has always presumably benefited from cheap foreign currency through the RBZ. They wouldn’t have been able to buy all those buses without being propped up by taxpayers. This means they have never really bothered to actively seek foreign currency through direct ticket sales. Why they are choosing to do so now is anyone’s guess.

It is als0 unlikely that they will get much foreign currency through ticket sales anyway. Even though the gap has narrowed, there is still a wide gulf between unofficial rates of around $750 ZWL to 1 USD and the current williing buyer willing seller rate of around $550 ZWL. This means that there is little incentive for a customer to pay a fare of US$1 (actually $800 ZWL in some places) rather than $550 ZWL. People will do what they have done, convert USD on the black market and pay using ZWL instead of using USD to pay directly.

Even in the event they are some customers unwise enough to take up the offer there will always been someone in the ZUPCO chain who will take advantage of arbitrage opportunities offered by the differences between the official rate and the unofficial rates out there. We have witnessed it. Some elderly person pays with USD and the conductor gives them change based on the official rate. They change the money back into ZWL and pocket the profit as soon as they can. Urban transport does not offer opportunities for inspectors to clamp on this and even in cases like this, the inspector will is more likely to demand and cut than bother with enforcing the rules.

Here are the new fares

Here are the new fares starting 1 September. Please note that if you want to see the current fares you have to visit our ZUPCO fares page.